Jharkhand to give 80 percent VAT relief to new industries

Ranchi, April 15 (IANS) The Jharkhand government, which is preparing the draft of a new industrial policy, will give 80 percent Value Added Tax (VAT) relief to those setting up industries in the state while businesses promoting handloom, sericulture and khadi will be given full exemption, an official said. The previous industrial policy, which was formulated in 2002, lapsed in 2005.

“There will be only one kind of subsidy instead of several forms of subsidy. Those who will set up industries in the state will be given VAT exemption up to 80 percent. Industries set up to promote handloom, sericulture and khadi will be given full exemption,” the official said.

A fund is also likely to be created for sick and closed industries. The money will be raised with help of the state government and the Federation of Jharkhand Chamber of Commerce and Industries. The sick or closed industries will be given an exemption of five years for the annual minimum guarantee paid to the state government.

“The new industrial policy will promote large scale investors and at the same time it will also promote and protect the interest of the small and medium scale industries,” the official said.

About 8,000 small and medium scale industries in Jharkhand are either closed or sick. To help the state run industries, the government has formulated a purchase policy by which 58 products will be purchased by the administration from them.

In the last five years, Jharkhand signed memorandums of understanding (MoU) with 55 companies in steel, mining and power sectors. However, sources said industrialisation has suffered due to the absence of rehabilitation and resettlement and industrial policies.